Telecom panel for minimum 3% spectrum usage charge

This will be applicable to all the bands, except for 2,300 MHz band

As telecom companies gear up for the biggest-ever telecom spectrum auction, the Telecom Commission on Monday decided to set a minimum 3 per cent spectrum usage charges (SUC) to create a level playing field among operators, according to an official source.

The panel -- the highest decision-making authority in telecom policy -- is expected to send its recommendations for Cabinet approval next week.

The Department of Telecom (DoT) will go by the weighted-average formula but in case the telecom service provider's SUC is below 3 per cent, it will be charged 3 per cent or higher.

If the proposals are accepted in the Cabinet, then Bharti Airtel will now need to pay 3.8 per cent as minimum SUC charges from about 4.9 per cent earlier, and Reliance Jio Infocomm will pay about 3.05 per cent from the previous weighted-average formula of 2.88 per cent, the source said.

 

This 3 per cent will be applicable to all the bands, except 2,300 MHz. For 2,300 MHz, the SUC recommended by the panel is 1 per cent.

The government gets around Rs 7,000 crore every year from SUC.

"Everything will now move to 3 per cent. That is what Telecom Regulatory Authority of India had suggested," the source said.

Reacting to the suggestions, Cellular Operators' Association of India (COAI) Rajan S. Mathews told IANS: "This recommendation by Telecom Commission on SUC is disappointing for operators. This methodology does not help the industry. The cost will increase, which may get passed on to the customers in the long run."

Asking how much will it impact the upcoming telecom auction in September, he said: "It will have an impact on the decision of spectrum acquisition by the operators."

The government is expecting to mop up around Rs 5.66 lakh crore from the upcoming biggest-ever telecom airwaves auction.

With regard to the spectrum, a Cabinet meeting last month had approved the auction of over 2,300 MHz of airwaves in sevenbands -- 700 MHz, 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz and 2,500 MHz. The previous round had seen 470.75 MHz on the block.